The government of Iran is considering ditching the U.S. dollar for a $10 billion bilateral trade with Iraq. The two nations are aiming to strengthen their native currencies and end dependence on the U.S. dollar. The move would bolster their local economies and help businesses sustain in the long run. The Iran-Iraq deal comes at a time when the BRICS alliance is looking to form a new currency to take on the U.S. dollar.
Also Read: 7 Countries Most Likely To Join BRICS Alliance at August Summit
Iran is considering paying the Iraqi Dinar in the $10 billion trade to Iraq eliminating the USD currency. If the trade is successful, the Iraqi Dinar could be the alternative currency between Iran and Iraq going forward and not the U.S. dollar. Replacing the dollar to Dinar could further weaken the greenback and make the currency difficult to fund its deficit.
BRICS: Iran To Settle $10 Billion Trade With Iraq Using the Dinar, Not U.S. Dollar
The head of the Iran-Iraq Chamber of Commerce Yehya Eshaq said both countries want their national currencies to be traded. Eshaq added that a handful of countries are joining hands to break America’s hegemony on global finances. The use of local currencies for global trade is the first step to bring the dollar down, he said.
Also Read: BRICS Nations Buy Massive Amounts of Gold to Back the New Currency
“Most countries in the world are looking for breaking the American hegemony in their exchanges. The use of national currencies can help accelerate this process,” he said to Iran’s Mehr News Agency.
Eshaq added that the government of Iran aims to undermine the U.S. dollar’s global dominance going forward. “By favoring the Dinar over the Dollar in trade operations with Iraq, we are actively undermining the dollar’s dominance in our import-export transactions as part of a wider governmental strategy.”
Read here to know how many U.S. sectors could be affected if BRICS launch their new currency in the markets.
Also Read: BRICS: India Saves $7 Billion by Ditching U.S. Dollar For Oil Trade
BRICS will soon launch their new currency and both Iran and Iraq are ready to accept the new tender. Iraq and Iran and keen on ending reliance on the U.S. dollar and accept BRICS currency. This would put the U.S. dollar under pressure and make the BRICS currency sustain itself globally. BRICS is an acronym for Brazil, Russia, India, China, and South Africa.